HMRC Warns Against Stamp Duty Rogue Agents: Stay Vigilant!

CREATED BY HELEN BEAUMONT Published: 06/08/2025 @ 09:00AM #HMRC #CourtOfAppeal #StampDuty #RepaymentClaims #RogueAgents

Following a recent Court of Appeal ruling, HMRC has announced a crackdown on fraudulent Stamp Duty repayment claims. Homebuyers are advised to avoid rogue agents touting misleading schemes that could result in significant penalties ...

Stamp duty burden, Heavy tax on home buyers, Ouch, my wallet weeps

As homeowners navigate the complexities of property purchases, it is crucial to understand the implications of Stamp Duty levies. Recent developments, particularly a landmark ruling by the Court of Appeal in the case of Mudan & Anor v HMRC, have put the spotlight on fraudulent practices concerning stamp duty claims. The ruling reaffirms that Stamp Duty Land Tax (SDLT) is chargeable on homes that retain the fundamental characteristics of a dwelling, regardless of their state of disrepair.

Be careful of rogue agents!

In recent months, rogue agents have proliferated in the marketplace, enticing unsuspecting homebuyers with promises of recovering substantial sums of Stamp Duty. They assert that by purchasing properties that are deemed uninhabitable, buyers can circumvent SDLT obligations.

This tactic is not only misleading, but is likely to lead to long-term consequences. Following the Mudan case, where the appellants sought a hefty £99,750 repayment while asserting their newly purchased property was unsuitable for living, it has become increasingly clear that such claims are ill-advised.

The Court's decision, articulated by Lord Justice Kim Lewison KC, underscored that properties with recent habitation, even if currently in poor condition, are still subject to Stamp Duty. Homebuyers should take note of the ramifications of these fraudulent claims, as HMRC has signalled its intent to tackle this emerging problem with both civil and criminal actions.

Take, for instance, the scenario presented by HMRC involving a fictional purchaser of a £1.1m property in disrepair. The agent sought to claim a £9,250 refund on a ‘no win no fee' basis, leading to a reduced amount after the agent's cut. However, the purchaser found himself ensnared in compliance checks, at risk of repaying the entirety of the claimed refund, in addition to accruing interest and penalties.

The agent vanished after getting their cut, leaving the
homeowner to deal with the repercussions!

Homebuyers are strongly advised to refrain from allowing third parties to file Stamp Duty claims on their behalf. An inaccurate claim can ultimately lead to severe financial headaches, greater than the potential recoverable amounts.

The Court of Appeal's ruling against improper Stamp Duty repayment claims serves as a critical reminder: a property's current state of repair does not exempt it from tax liabilities if it retains fundamental characteristics as a dwelling.

Homebuyers must remain vigilant and informed to navigate these waters safely and protect their investments from the pitfalls of stamp duty chancers.

It is always best to consult with trusted professionals before acting on such claims.

Until next time ...

HELEN BEAUMONT
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About Helen Beaumont ...
Helen brings the personal tax planning experience of the top 20 tax companies to Essendon. Formerly of MacIntyre Hudson (with 45 offices nationwide), Helen worked at Chancery for more than 10 years before joining Essendon as the personal tax specialist. Tax Planning can make a considerable difference to your tax liability. Helen has specialist knowledge and experience in tax planning and uses every opportunity to minimise your tax bill is utilised. By analysing your investments, income, profit and expenditures, Helen will provide strategic tax planning expertise that could offer significant savings, whilst delivering clear, honest advice and guidance. When Helen is not at Essendon she spends time with her young son and likes going on long walks with the family dog.

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